Xplora Kids' Smartwatches: Security and Connectivity for ParentsHello guys,
When looking at the development of families, I have noticed a growing fear among parents and the digitization and associated pressure from other children. Therefore, here are my reasons for investing in Xplora:
Xplora is a Norwegian company that manufactures and distributes smartwatches and other wearables for children. The company was founded in 2016 and has been listed on the Oslo Stock Exchange since March 2020.
Economy
Products
Recurring Revenue
App
Service / Support
Target Group
Risks
Conclusion
Economy
The company has annually increasing revenues but is not yet profitable. However, the profit margin has decreased from -83% to -3% since the beginning. The asset coverage ratio is 30%. The book value per share is currently 0.88, which means that it is currently undervalued from a fundamental perspective. (1)
Products
Xplora offers smartwatches for children, and the latest version was recently awarded the Innovation Award at CES 2023. (2) Through a SIM card, parents can always stay in touch with their children, meaning they can make calls and send messages to pre-approved contacts and track their children. Regarding safety, the smartwatch offers a "Safe Zone", meaning that if the child is outside this zone, parents will be notified. An SOS function can also notify up to two people. In addition, the watch has a few games and a selfie camera. To motivate children to move more, all steps are counted and converted into coins. These coins can be used to purchase watch faces, ringtones, and even real consoles. Furthermore, games can also be unlocked and played on the Xplora website. The motto is "Earn screen time with movement".
Recurring Revenue
However, to convert steps into coins, a "GoPlay" subscription is required, which generates stable revenue in the form of a subscription model for the company.
App
In addition to the watch, an app is also offered that administrators can use to configure the watch. Furthermore, messages can only be sent using the app. It has a very clear and modern design. The app has received some negative reviews in the Play Store recently because many features were not working. According to support, this should have been fixed with version 1.2.80. (3)
Service / Support
The company offers a self-help desk for its products. Support is only available via ticket, unfortunately, no phone number is listed on the website.
Target Group
Customers include parents who want more security and control for their children. In recent years, the number of parents who are likely influenced by the news has been increasing. The fact alone that you know where the child is provides security, and the innate need for control is also satisfied. Despite my search, I could not find any statistics on this topic and therefore rely on my own considerations. On the other hand, the desire for the watch may also come from the children themselves. If someone in the class promotes it, others also want it.
Risks
Tightening of data protection laws, especially for sensitive data such as location.
Dependency on the European market, which is currently not very stable due to the Ukraine war.
There are many competitors in the market.
To remain competitive in the market and stand out from the crowd, new innovations and developments must be created.
Conclusion
Parents should ask themselves how best to enter the digital world. With a mobile phone, one is exposed to many dangers, whereas a smartwatch offers the same function. Xplora is hitting the pulse of the times with its smartwatches. Given the current uncertainty in Europe, the stock recovery will have to wait. The function that you can earn coins with steps is perfect for younger children. However, the smartwatch faces tough competition from consoles, although they cannot be directly compared.
Sources
myxplora de
(1) de.tradingview com/symbols/OSL-XPLRA
(2) www.ces tech/innovation-awards/honorees/2023/best-of/x/xplora-x6-play.aspx
(3) play google com/store/apps/details?id=com.xplora.xplorao2o
personal considerations
